Summary
- Coming in force from 1st October 2024
- All tips (without any kind of deduction) to be passed to workers (agency workers included) by end of following month.
- Businesses required to have a written tipping policy to ensure fairness and transparency.
- Code or Act does not affect taxation of tips.
- Cash tips (if no control exercised by employer) are out of scope of Tipping Act and Code.
- Tips will be distributed in the restaurant where collected. One restaurant’s tips cannot be paid to staff of other restaurant.
Tipping policy – Factors to Consider
Businesses need to prepare and distribute the tipping policy to all staff members including agency workers. Tipping policy needs to inform staff the basis of tips allocation. Basis can be on several factors, see example list below:
a. Type of role/work e.g. distribution between front of house and backroom workers
b. Basic pay (and how workers are engaged)
c. Hours worked during period when tips are received
d. Individual and/or team performance
e. Seniority/level of responsibility
f. Length of time served with the employer
g. Customer intention
Employers should consult with workers to seek broad agreement in the workplace that the system of allocation of tips is fair, reasonable and clear.
Records
Workers can ask for past 3 years records. Employer will need to provide total tips collected during their employment and amount allocated to the worker making the request but not the specific amounts paid to other workers.
If a worker does not wish to participate in Tronc, Tronc master should get this in writing.
Action:
Restaurants should start preparing a written Tronc policy.
Roy Accountants 